The U.S. Energy Information Administration (EIA) released its latest Short-Term Energy Outlook (STEO) on January 14, 2025, which includes forecasts through 2026. 

The STEO expects U.S. crude oil production to reach 13.5 million barrels per day in 2025 and increase to 13.6 million barrels per day in 2026. Global oil production is also forecasted to outpace demand, leading to a downward pressure on oil prices. The Brent crude oil spot price is forecasted to average $74 per barrel in 2025 and decrease to $66 per barrel in 2026, reflecting the expected surplus in global oil supply. 

Renewable energy sources are projected to contribute 27% of U.S. electricity generation by 2026, marking a significant increase from previous years. There is an expected growth in electricity demand in both the commercial and industrial sectors. The commercial sector is projected to see a 2% growth in both 2025 and 2026, largely due to increased data-center power consumption. The industrial sector is anticipated to experience faster growth, with a 2% increase in 2025 and 3% in 2026, as new manufacturing operations for semiconductors and batteries come online.

Solar power supplies most of the increase in U.S. generation. The STEO expects to see the addition of 26 gigawatts (GW) of new solar capacity in the U.S. electric power sector during 2025 and 22 GW in 2026. These capacity additions will support the increase of U.S. solar generation by 34% in 2025 and by 17% in 2026. Rising generation from total renewables will cause natural gas generation to decline by 3% in 2025 and by another 1% in 2026. Generation from coal-fired power plants falls by 1% in 2025 and then rises slightly in 2026, as coal generators become more competitive with natural gas generators, which are expected to face rising fuel costs.

These forecasts reflect the current expectations based on available data and should be considered with an understanding of the inherent uncertainties in energy market predictions. Macroeconomic assumptions are a key driver in the forecast. The STEO assumes U.S. GDP will grow by 2% in both 2025 and 2026.

/EIA/